Wireline | issue 14 | Oct 2010
containment equipment from the Gulf of Mexico. The devices were developed by BP in response to the Macondo incident and are designed to be a key component in helping to capture oil leaking from an uncontrolled well.
Importantly, the TRG is liaising with the Gulf of Mexico Joint Industry Task Force to ensure technology developments and lessons learned are shared. Similarly the group remains linked with work being carried out by industry across Europe and other parts of the world through the International Association of Oil and Gas Producers (OGP).
Second, the Indemnities and Insurance Review Group (IIRG) was set up to assess the potential remediation and compensation costs associated with a range of different oil spill scenarios from minor leaks to major incidents. Companies operating in the UK are fully responsible for environmental or other material damage resulting from operational failures on their installations and there is no legislative cap on the extent of that responsibility for clean-up and compensation.
However, in addition to this liability, in 1975 the UK oil and gas industry established the Offshore Pollution Liability Association Ltd (OPOL). OPOL administers a voluntary industry mutual agreement which requires each operator to accept strict, ‘no fault’ liability for pollution damage and reimbursement of public authorities for remedial measures up to a pre- determined limit. Each operator is required to provide to the OPOL administration evidence of its financial ability to meet its liability under the agreement. All UK operators are OPOL members.
In the event that an OPOL member fails to meet its obligation and goes into default, the mutual agreement represents the committed response of the oil and gas industry in stepping up to make good the default up to a pre- determined limit, without limiting claimants’ rights at law to pursue any unsatisfied claims against the relevant member. On 18 August, on OSPRAG’s recommendation, the members of OPOL agreed to increase the limit of the OPOL guarantee from US$120 million to US$250 million per incident which is sufficient to cover the third party costs of an oil spill in previously modelled spill scenarios. The agreement came into effect on 1 October 2010.
In order to provide a more comprehensive picture of potential oil spill costs, the IIRG and the third OSPRAG review group, the Oil Spill Response Group (OSRG), have commissioned modelling of additional spill scenarios. The OSRG was established to review the UK’s oil spill response capability and industry co-ordination with the national response mechanism. In addition to spill scenarios and modelling, its areas of focus are a review of physical response capability, sensitivity and protection mapping in relation to clean up and restoration and Oil Pollution Emergency Plans (OPEPs). On the last point, this group is preparing for a major exercise during 2011 which will involve physical deployment of emergency response capabilities.
The final OSPRAG group, the European Issues and Global Liaison Sub-group is working with the International Association of Oil and Gas Producers (OGP) in response to the EU Energy
Commissioner’s announcement to introduce changes to the regulation of offshore drilling in early 2011. Oil & Gas UK has robustly rejected his proposals on the basis that the UK’s regulatory system is robust and fit for purpose and any move that undermines its goal setting principles could put the safety of the workforce at risk.
Ensuring that the UK oil and gas industry puts safety and environmental protection first is Oil & Gas UK’s top priority. Therefore, we will continue to provide resources to OSPRAG to make sure its review of regulation and operations is thorough and that any improvements identified are implemented in a timely manner.
For the latest updates on OSPRAG’s work, please visit http://www.oilandgasuk.co.uk/
Thursday 18 November 2010 | 9.00am – 5.00pm
Environmental Seminar – towards a sustainable future Aberdeen Exhibition and Conference Centre, Bridge of Don, Aberdeen, AB23 8BL
The regulatory ‘seascape’ for industrial operations on the UKCS is changing, driven by domestic and international policies to protect biodiversity in the marine environment and to promote sustainable use of the sea. In the next five to ten years we will see significant differences in the way that activities are managed, through a system of marine planning and marine protected areas, which can have a real impact on our objective to maximise production from the UKCS. This seminar will provide a broad overview of the challenges and highlight some of the Oil & Gas UK activities in response.
This seminar will be of interest to environmental practitioners and also to operations managers who need an overview of how these issues can impact their business.
For further information on the event agenda and speakers, and to book visit: www.oilandgasuk.co.uk/events
Listen to experts from industry Network Learn Debate Enjoy Page 11
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